Consolidated operating income increased nearly $6 million, from $0.6 million in the fourth quarter of last year to $6.3 million in this year's fourth quarter, on significant operating leverage;

Both Applied Technology and Engineered Films achieved sales growth of more than 35% in the fourth quarter and drove a nearly three-fold increase in division profit, doubling division operating margin year-over-year;

Engineered Films' sales into the Geomembrane market (which includes Energy) continued to accelerate in the fourth quarter, with sales into this market
increasing $5.6 million, or more than 100 percent year-over-year;

Aerostar returned to profitability in the fourth quarter on cost control measures and higher sales of stratospheric balloons to Google for Project Loon;

Subsequent to the end of the fourth quarter, Aerostar was awarded a new $4 million stratospheric balloon contract with a new customer, with most of the revenue expected to be recognized in fiscal year 2018;

Operating income for the fourth quarter of fiscal 2017 was $6.3 million versus operating income of $0.6 million in the fourth quarter of fiscal 2016. Improved sales volume resulted
in strong operating leverage and drove the significant increase in operating income year-over-year. Correspondingly, operating margin exhibited a noteworthy improvement, increasing from 1.1 percent in the fourth quarter of last year to 9.1 percent in this year's fourth quarter.

Net income for the fourth quarter of fiscal 2017 was $4.4 million, or $0.12 per diluted share, versus net income of $1.9 million, or $0.05 per diluted share, in last year's fourth quarter. The increase in earnings per share was driven primarily by the improved operating performance in both Applied Technology and Engineered Films.

Balance Sheet and Cash Flow:At the end of the fourth quarter of fiscal 2017, cash and cash equivalents totaled $50.6 million, up $4.3 million
versus the prior quarter.

Net working capital as a percentage of annualized net sales improved 900 basis points year-over-year, from 36.9 percent in the fourth quarter of last year to 27.9 percent in this year's fourth quarter. The decrease in net working capital percentage was primarily the result of both lower inventory levels and higher payables.

Cash flow from operations was $9.9 million in the fourth quarter of fiscal year 2017 versus $8.8 million in the previous year's fourth quarter. The increase in cash was primarily due to improved profitability versus the prior year.

Capital expenditures were $0.9 million in this year's fourth quarter, down $1.4 million versus $2.3 million in the fourth quarter of fiscal 2016. For fiscal year 2017, capital expenditures were $4.8
million, down $8.2 million versus $13.0 million in the prior year. For fiscal year 2018, the Company expects total capital expenditures to be approximately $10 to $12 million.

Applied Technology Division Fourth Quarter Results:Net sales for Applied Technology in the fourth quarter of fiscal 2017 were $25.9 million, up 40.4 percent versus the fourth quarter of fiscal 2016. Geographically, domestic sales were up 44.0 percent year-over-year and international sales were up 29.8 percent year-over-year. Consistent with the third quarter of fiscal 2017, sales growth for the division was driven by new product sales, expanded OEM relationships, and higher sales of
direct injection systems.

Division operating income was $6.4 million, up 184.3 percent versus the fourth quarter of fiscal 2016. The increase in operating income was driven primarily by increased operating leverage due to higher sales volume versus the previous year. Operating margin for the division increased from 12.1 percent in the fourth quarter of the prior year to 24.6 percent in the fourth quarter of this year. The increase in operating margin was driven by strong incremental margins on improved sales.

Operating income in the fourth quarter of fiscal 2017 was $5.3 million, up $3.4 million or 177.3 percent versus the fourth quarter of fiscal 2016. The year-over-year increase in operating income was driven principally by strong operating leverage as sales volumes increased significantly. Division operating margin increased 780 basis points year-over-year, from 7.5 percent to 15.3 percent, driven by improved capacity utilization and spending discipline.

Aerostar Division Fourth Quarter Results:Net sales for Aerostar during the
fourth quarter of fiscal 2017 were $8.8 million, down $0.2 million or 2.5 percent versus the fourth quarter of fiscal 2016. The decline in sales was driven primarily by lower Aerostat sales year-over-year due to the timing of deliveries. Sales of stratospheric balloons to Google for Project Loon were up significantly year-over-year, while sales of research balloons were down due to the timing of deliveries.

Operating income in the fourth quarter of fiscal 2017 was $0.2 million, flat with the fourth quarter of last year.

Fiscal 2018 Outlook:"We are very pleased with the progress made and performance achieved throughout fiscal year 2017," said Dan Rykhus, President and CEO. "Both Applied Technology
and Engineered Films continue to drive improved sales and profitability and Aerostar returned to profitability following several quarters of operating losses."

"For Applied Technology the Ag market is expected to remain weak, but we will focus on capitalizing on our new products and strong relationships to drive additional market share gains. In addition, our direct injection system, which is industry-leading technology, is poised for growth in fiscal year 2018. Rapid adoption of more complex spraying practices are leading to a significant increase in demand for this existing technology.

"Regarding Engineered Films, the Geomembrane market (which includes Energy) is rebounding from trough levels in fiscal year 2016 and momentum continues to build in the Industrial market. Market share gains and success in
selling the capacity of our recent strategic investment in new production lines are driving sales growth in the Industrial market. We recently expanded our manufacturing footprint in Texas with the purchase of a facility in Pleasanton, and we are excited about the opportunity to service the Eagle Ford Basin, a new territory for our Geomembrane product lines.

"With Aerostar, cost controls that were implemented throughout fiscal year 2017, combined with a new stratospheric balloon contract and strength in sales to Google for Project Loon, have better-positioned the division for improved financial performance, but volatility risks remain.

"We are entering fiscal year 2018 from a
position of strength because of the actions taken to preserve and strengthen our core businesses," concluded Rykhus. "Overall, we are optimistic about the future and expect to make continued progress on our long-term goal to generate 10 percent annualized earnings growth while generating strong relative returns on equity and assets."

Regulation G:The information presented in this earnings release regarding adjusted operating income2, adjusted net income and adjusted earnings per share3, and earnings before interest, taxes, depreciation, and amortization (EBITDA)4 do not conform to generally accepted accounting principles (GAAP) and should not be construed as an alternative to the reported results determined in accordance with GAAP. Management has included this non-GAAP information to assist in understanding
the operating performance of the Company and its operating segments by excluding the impacts of unusual charges which are non-recurring in nature and which from management's perspective significantly impact the comparison of year-over-year changes in underlying financial performance. The non-GAAP information provided may not be consistent with the methodologies used by other companies. All non-GAAP information is reconciled with reported GAAP results in the tables below.

Conference Call Information:The Company will host an investor conference call to discuss fourth quarter fiscal 2017 results tomorrow, Tuesday, March 28, 2017, at 9:00 a.m. Central Time (10:00 a.m. Eastern Time). The conference call audio will be available to all interested parties via a simultaneous webcast that can be accessed through the
Investor Relations section of the company's website at http://investors.ravenind.com. Analysts and investors are invited to join the conference call by dialing: +1 (866) 393-0676. The event is scheduled to last one hour. For those unable to listen live, an audio replay of the event will be archived on the Company's website.

About Raven Industries, Inc.: Raven Industries (NASDAQ:RAVN) is dedicated to providing innovative, high-value products and solutions that solve great challenges throughout the world. Raven is a leader in precision agriculture,
high-performance specialty films, and lighter-than-air technologies. Since 1956, Raven has designed, produced, and delivered exceptional solutions, earning the company a reputation for innovation, product quality, high performance, and unmatched service. For more information, visit http://ravenind.com.

Forward-Looking Statements:This news release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding the expectations, beliefs, intentions or strategies regarding the future. The Company intends that all forward-looking statements
be subject to the safe harbor provisions of the Private Securities Litigation Reform Act.

Generally, forward-looking statements can be identified by words such as "may," "will," "plan," "believe," "expect," "intend," "anticipate," "potential," "should," "estimate," "predict," "project," "would," and similar expressions, which are generally not historical in nature. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future — including statements relating to our future operating or financial performance or events, our strategy, goals, plans and projections regarding our financial position, our liquidity and capital resources, and our product development — are forward-looking statements.

Management believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements, because such statements speak only as of the date when made. Our Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain known risks, as described in the Company's 10-K/A under Item 1A, and unknown risks and uncertainties that may cause actual results to differ materially from our Company's historical experience and our present expectations or projections.

RAVEN INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Dollars and shares in thousands, except earnings per share) (Unaudited)

Three Months Ended January 31,

Twelve Months Ended January 31,

Fav (Un)

Fav (Un)

2017

2016

Change

2017

2016

Change

Net sales

$

68,915

$

52,827

30.5

%

$

277,395

$

258,229

7.4

%

Cost of goods
sold

49,596

41,042

199,205

191,255

Gross profit

19,319

11,785

63.9

%

78,190

66,974

16.7

%

Gross profit percentage

28.0

%

22.3

%

28.2

%

25.9

%

Research and development expenses

3,837

3,929

16,312

14,686

Selling, general and administrative expenses

9,204

7,272

33,378

32,574

Goodwill impairment loss

-

-

-

11,497

Long-lived asset impairment loss

-

13

87

3,826

Operating income

6,278

571

999.5

%

28,413

4,391

547.1

%

Operating income percentage

9.1

%

1.1

%

10.2

%

1.7

%

Other income (expense), net

19

123

(560

)

(310

)

Income before income taxes

6,297

694

807.3

%

27,853

4,081

582.5

%

Income tax expense (benefit)

1,859

(1,238

)

7,661

(767

)

Net income

4,438

1,932

129.7

%

20,192

4,848

316.5

%

Net income attributable to noncontrolling interest

-

14

1

72

Net income attributable to Raven Industries

$

4,438

$

1,918

131.4

%

$

20,191

$

4,776

322.8

%

Net income per common share:

-basic

$

0.12

$

0.05

140.0

%

$

0.56

$

0.13

330.8

%

-diluted

$

0.12

$

0.05

140.0

%

$

0.56

$

0.13

330.8

%

Weighted average common shares:

-basic

36,175

36,599

36,242

37,324

-diluted

36,387

36,665

36,372

37,400

RAVEN INDUSTRIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)
(Unaudited)

January 31

January 31

2017

2016

ASSETS

Cash, and cash equivalents

$

50,648

$

33,782

Accounts receivable, net

43,143

38,069

Inventories

42,336

45,839

Other current assets

2,689

7,539

Total current assets

138,816

125,229

Property, plant and equipment, net

106,324

115,704

Goodwill and amortizable
intangibles, net

52,697

53,628

Other assets, net

3,672

4,127

Total Assets

$

301,509

$

298,688

LIABILITIES AND SHAREHOLDERS' EQUITY

Accounts payable

$

8,467

$

6,038

Accrued and other liabilities

19,915

12,781

Total current liabilities

28,382

18,819

Other liabilities

13,696

15,640

Shareholders' equity

259,431

264,229

Total Liabilities and Shareholders' Equity

$

301,509

$

298,688

RAVEN INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in thousands) (Unaudited)

Twelve Months Ended January 31,

2017

2016

Cash flows from operating activities:

Net income

$

20,192

$

4,848

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

15,436

17,136

Goodwill impairment loss

-

11,497

Long-lived asset impairment loss

87

3,826

Other operating activities, net

12,921

6,701

Net cash provided by operating activities

48,636

44,008

Cash flows from investing activities:

Capital expenditures

(4,796

)

(13,046

)

Proceeds related to business acquisitions

-

351

Proceeds from sale of assets

1,188

2,124

Proceeds from sale or maturity of investments

250

250

Purchases of investments

(750

)

(250

)

Other investing activities, net

(534

)

(503

)

Net cash used in investing activities

(4,642

)

(11,074

)

Cash flows from financing activities:

Dividends paid

(18,839

)

(19,426

)

Payments for common shares repurchased

(7,702

)

(29,338

)

Payment of acquisition-related contingent liabilities

(354

)

(814

)

Debt issuance costs paid

-

(548

)

Other financing activities, net

(256

)

(558

)

Net cash used in financing activities

(27,151

)

(50,684

)

Effect of exchange rate changes on cash

23

(417

)

Net increase (decrease) in cash and cash equivalents

16,866

(18,167

)

Cash and cash equivalents at beginning of period

33,782

51,949

Cash and cash equivalents at end of period

$

50,648

$

33,782

RAVEN INDUSTRIES, INC.

SALES AND OPERATING INCOME BY SEGMENT

(Dollars in thousands) (Unaudited)

Three Months Ended January 31,

Twelve Months Ended January 31,

Fav (Un)

Fav (Un)

2017

2016

Change

2017

2016

Change

Net sales

Applied Technology

$

25,890

$

18,434

40.4

%

$

105,217

$

92,599

13.6

%

Engineered Films

34,548

25,436

35.8

%

138,855

129,465

7.3

%

Aerostar

8,800

9,030

(2.5

)%

34,113

36,368

(6.2

)%

Intersegment eliminations

(323

)

(73

)

(790

)

(203

)

Total Company

$

68,915

$

52,827

30.5

%

$

277,395

$

258,229

7.4

%

Operating income (loss)

Applied Technology

$

6,363

$

2,238

184.3

%

$

26,643

$

18,319

45.4

%

Engineered Films

5,300

1,911

177.3

%

22,966

17,892

28.4

%

Aerostar

244

212

15.1

%

(1,560

)

(14,801

)

89.5

%

Intersegment eliminations

9

(2

)

(12

)

91

Total segment income

$

11,916

$

4,359

173.4

%

$

48,037

$

21,501

123.4

%

Corporate expenses

(5,638

)

(3,788

)

(48.8

)%

(19,624

)

(17,110

)

(14.7

)%

Total Company

$

6,278

$

571

999.5

%

$

28,413

$

4,391

547.1

%

Operating income (loss) percentages

Applied Technology

24.6

%

12.1

%

1,250bps

25.3

%

19.8

%

550bps

Engineered Films

15.3

%

7.5

%

780bps

16.5

%

13.8

%

270bps

Aerostar

2.8

%

2.3

%

50bps

(4.6

)%

(40.7

)%

3,610bps

Total Company

9.1

%

1.1

%

800bps

10.2

%

1.7

%

850bps

RAVEN INDUSTRIES, INC.

ADJUSTED OPERATING INCOME REGULATION G RECONCILIATION2

(Dollars in thousands) (Unaudited)

Three Months Ended January 31,

Twelve Months Ended January 31,

Fav (Un)

Fav (Un)

2017

2016

Change

2017

2016

Change

Aerostar

Reported operating income (loss)

$

244

$

212

15.1

%

$

(1,560

)

$

(14,801

)

89.5

%

Plus:

Goodwill impairment loss

-

-

-

11,497

Long-lived asset impairment loss

-

-

-

3,813

Pre-contract costs written off

-

-

-

2,933

Less:

Acquisition-related contingent liability benefit

-

-

-

2,273

Aerostar adjusted operating income (loss)

$

244

$

212

15.1

%

$

(1,560

)

$

1,169

(233.4

)%

Aerostar adjusted operating income (loss) % of net sales

2.8

%

2.3

%

(4.6

)%

3.2

%

Consolidated Raven

Reported operating income

$

6,278

571

999.5

%

$

28,413

4,391

547.1

%

Plus:

Goodwill impairment loss

-

-

-

11,497

Long-lived asset impairment loss

-

-

-

3,813

Pre-contract costs written off

-

-

-

2,933

Less:

Acquisition-related contingent liability benefit

-

-

-

2,273

Consolidated adjusted operating income

$

6,278

$

571

999.5

%

$

28,413

$

20,361

39.5

%

Consolidated adjusted operating income % of net sales

9.1

%

1.1

%

10.2

%

7.9

%

RAVEN INDUSTRIES, INC.

ADJUSTED NET INCOME REGULATION G RECONCILIATION3

(Dollars and shares in thousands, except earnings per share) (Unaudited)

Three Months Ended January 31,

Twelve Months Ended January 31,

Fav (Un)

Fav (Un)

2017

2016

Change

2017

2016

Change

Consolidated Raven

Reported net income attributable to Raven Industries

$

4,438

$

1,918

131.4

%

$

20,191

$

4,776

322.8

%

Plus:

Goodwill impairment loss

-

-

-

11,497

Long-lived asset impairment loss

-

-

-

3,813

Pre-contract costs written off

-

-

-

2,933

Less:

Acquisition-related contingent liability benefit

-

-

-

2,273

Net tax benefit on adjustments

-

-

-

5,693

Adjusted net income attributable to Raven Industries

$

4,438

$

1,918

131.4

%

$

20,191

$

15,053

34.1

%

Adjusted net income per common share:

-basic

$

0.12

$

0.05

140.0

%

$

0.56

$

0.40

40.0

%

-diluted

$

0.12

$

0.05

140.0

%

$

0.56

$

0.40

40.0

%

Weighted average common shares:

-basic

36,175

36,599

36,242

37,324

-diluted

36,387

36,665

36,372

37,400

RAVEN INDUSTRIES, INC.

EBITDA REGULATION G RECONCILIATION4

(Dollars in thousands) (Unaudited)

Three Months Ended January 31,

Twelve Months Ended January 31,

Fav (Un)

Fav (Un)

Segments

2017

2016

Change

2017

2016

Change

Applied Technology

Reported operating income

$

6,363

$

2,238

184.3

%

$

26,643

$

18,319

45.4

%

Plus: Depreciation and amortization

971

1,087

(10.7

)%

3,828

4,428

(13.6

)%

ATD EBITDA

$

7,334

$

3,325

120.6

%

$

30,471

$

22,747

34.0

%

ATD EBITDA % of Net Sales

28.3

%

18.0

%

29.0

%

24.6

%

Engineered Films

Reported operating income

$

5,300

$

1,911

177.3

%

$

22,966

$

17,892

28.4

%

Plus: Depreciation and amortization

2,149

1,955

9.9

%

8,580

7,735

10.9

%

EFD EBITDA

$

7,449

$

3,866

92.7

%

$

31,546

$

25,627

23.1

%

EFD EBITDA % of Net Sales

21.6

%

15.2

%

22.7

%

19.8

%

Aerostar

Reported operating income (loss)

$

244

$

212

15.1

%

$

(1,560

)

$

(14,801

)

89.5

%

Plus: Depreciation and amortization

462

501

(7.8

)%

1,720

3,297

(47.8

)%

Aerostar EBITDA

$

706

$

713

(1.0

)%

$

160

$

(11,504

)

101.4

%

Aerostar EBITDA % of Net Sales

8.0

%

7.9

%

0.5

%

(31.6

)%

Consolidated Raven

Net income

$

4,438

$

1,918

131.4

%

$

20,191

$

4,776

322.8

%

Income tax expense (benefit)

1,859

(1,238

)

7,661

(767

)

Interest expense (income), net

105

67

330

200

Depreciation and
amortization

3,910

3,935

15,436

17,136

EBITDA

$

10,312

$

4,682

120.2

%

$

43,618

$

21,345

104.3

%

EBITDA % of Net Sales

15.0

%

8.9

%

15.7

%

8.3

%

_____________________________

Net working capital is defined as accounts receivable (net) plus inventories less accounts payable. Net working capital percentage is defined as net working capital divided by
four times quarterly sales.

Adjusted operating income is a non-GAAP financial measure defined on a consolidated basis as consolidated operating income plus goodwill impairment loss, plus long-lived asset impairment loss, plus pre-contract cost write-off, less earn-out reduction benefit, all of which relate to the Vista Research business within the Aerostar division. For the Aerostar segment, it is defined as operating income plus goodwill impairment loss, plus long-lived asset impairment loss, plus pre-contract cost write-off, less earn-out reduction benefit, all of which relate to the Vista Research business within the Aerostar division.

Adjusted net income is a non-GAAP financial measure defined as net income/(loss) plus goodwill impairment loss, plus long-lived asset impairment loss, plus pre-contract cost write-off, less earn-out reduction
benefit, less income tax effect of these items, all of which relate to the Vista Research business within the Aerostar division. Adjusted diluted earnings per share is a non-GAAP financial measure defined as adjusted net income divided by weighted average diluted shares outstanding.

EBITDA is a non-GAAP financial measure defined on a consolidated basis as net income/(loss) attributable to Raven Industries, Inc., plus income taxes, plus depreciation and amortization expense, plus interest expense (net). On a segment basis, it is defined as operating income plus depreciation expense and amortization expense. EBITDA margin is defined as EBITDA divided by net sales.